Wednesday, April 13, 2016

Paul Ryan is a phony

Hype springs eternal — certainly when it comes to Paul Ryan, whose media image as a Serious, Honest Conservative and policy wonk seems utterly impervious to repeated demonstrations that he is neither serious nor honest, and that he actually knows very little about policy. And here we go again.

But what really amazes me about the latest set of stories is the promise that Ryan will finally deliver the Republican Obamacare alternative that his colleagues in Congress have somehow failed to produce after all these years. No, he won’t — because there is no alternative.

Or maybe I should say that there is no alternative to the right. Alternatives to the left do exist. True socialized medicine — an American NHS — would be feasible economically; so would single-payer, in the form of Medicare for all. The reasons we aren’t doing those are political.

But on the right, is there a more free-market, more privatized system that could replace the Affordable Care Act without causing the number of uninsured to soar? No, as some of us have tried to explain many times...

9 Comments:

Yes, I can think of a more free-market, more-privatized system that could replace the ACA, and eventually Medicaid and Medicare.

Enact a national health-care sales tax on all consumer goods and services and distribute the proceeds to all Americans in the form of healthcare assistance vouchers which could be redeemed only for healthcare expenses and/or insurance.

There would be no "free riders" since everyone who consumes would pay the sales tax. The funding would be progressive, since high-spenders would pay more into the system than they would get out of it. Poor and unemployed people would still get their voucher money no matter their status. The vouchers could be calibrated to cover 80% of typical annual healthcare expenses, encouraging people to pony up some "skin in the game" to cover the other 20%.

Most people would turn their vouchers over to insurance carriers and HMOs like Kaiser in exchange for broad coverage. Insurers could be allowed to compete for this business with whatever innovative and customized products suit the market. As a condition of eligibility for voucher dollars the insurers could be subjected to restrictions such as guaranteed issue and community rating, as they are under the ACA. Other than that there should be few regulations.

Since the vouchers would cover most insurance premiums, employers could start relieving themselves of the health insurance fringe benefit, or could restructure their existing benefits to incorporate the vouchers, thereby freeing up cash which could be used to increase employee salaries, in lieu of the insurance premiums the employers would no longer have to pay.

Of course some fools would squander their health-assistance dollars on vitamins and plastic surgery, or trade them in for unrestricted dollars, and then depend on charity when they get cancer or break a femur. But their plight would no longer be so tragic; their countrymen could sleep well knowing that the fools had been provided with the financial means to underwrite their healthcare risks.

I mentioned guaranteed issue and community rating, which essentially dictate that insurers must make coverage available to all who can pay, at a premium at or near what the average premium would be in a pool of everyone in the community.

Medicare already functions much like the system I describe, with market-oriented, competitive programs such as Medicare Advantage and the prescription drug benefit (A legacy of the W. Bush administration, the only federal healthcare entitlement in history to cost the taxpayers' less than originally forecast by the CBO). In both of these programs the Treasury funds the benefits but the recipient gets to direct the funds to whichever coverage provider offers the best product. Effectively a health-insurance assistance voucher.

As to the 20%, nowadays Medicare also requires most recipients to cough up some of their own cash towards premiums.

Instead we should simply expand Medicare to cover the uncovered, which is what Obamacare is trying to do, though it's being foiled by a lot of Republican governors who, not surprisingly, put right-wing ideology over the well-being of their citizens.

Actually, Rob, the ACA incorporates incentives to expand MediCAID coverage in the states, not MediCARE. Its major incentive, a stick rather than a carrot, was to de-fund the federal matching funds to Medicaid for those states which declined to participate in the expansion. This provision was thwarted by the Supreme Court, not governors. States that participate in the expansion and intend to continue it will have to scrounge up cash locally in just a few years, when the federally-funded carrot of temporary supplemental matching funds expires, as per the plain language of the ACA, as crafted by a veto-proof Democrat majority in both houses of Congress.

With all due respect, I wish you would consider getting some of your information from the Wall Street Journal's news section, which has a fine track record for accuracy and thoroughness in its coverage of political economy. I suspect it's too much to wish for you to ever read its opinion pages.

By the way, your point (complaint? I doubt you are complaining) about the formal GOP proposals, or promises of formal proposals, for ACA reform having been un-compelling to date, is well-taken.

Speaking of Fox News, it's fun to watch Bill O'Reilly's rants with the accompanying printed version alongside. He keeps the crib sheet up just long enough so that most of his audience that moves their lips when they read can keep up.